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The government shares a large portion of the blame. They removed the regulations which kept the industry in check. Without those restrictions and regulations, the banks acted unrestrained to maximize profit; which is what business does. However, the unfettered release of their leveraging abilities allowed the banks to operate in a regime which was not sustainable, and it broke; quite spectacularly. No, the CEO's are not to blame either. There must be proper regulation from the government as well.

The question is I think whether you want that regulation coming from a government in the form of control over your life, or through market forces where the people vote with their dollars.

j-mac

Americans are so enamored of equality that they would rather be equal in slavery than unequal in freedom.
Alexis de Tocqueville

The government shares a large portion of the blame. They removed the regulations which kept the industry in check. Without those restrictions and regulations, the banks acted unrestrained to maximize profit; which is what business does. However, the unfettered release of their leveraging abilities allowed the banks to operate in a regime which was not sustainable, and it broke; quite spectacularly. No, the CEO's are not to blame either. There must be proper regulation from the government as well.

No, they didn't remove all the regulations as there was enough oversight to prevent what happened, political correctness led to the problems we had in 2008 when it was determined by our govt. that everyone has a right to own a house and thus turned their heads on personal responsibility. The Senate banking and other oversight committees existed but were probably too busy with cocktail parties to do their job.

The question is I think whether you want that regulation coming from a government in the form of control over your life, or through market forces where the people vote with their dollars.

j-mac

Not all the regulations are enforcable through free market. In fact, the one which broke the system cannot be. There was a limit on the leverage banks could use on their loans. This is because without the external cap, the free market response is to ratchet it up as much as you can because the larger you can leverage the more possible money you can make. But highly leveraged loans are not sustainable, it's essentially a dramatic release of all the energy in the system. At some point, it can't keep going. But that point cannot be servoed through the free market as the free market response is short term and based on profit.

People saw it coming, they just couldn't do anything about it. As a bank you couldn't not participate. People were making money hand over fist and there was no way any player could stay out of it. You need government regulation in this case in order to put a hard limit on it. But there was a perfect storm a brewing. Clinton had gotten rid of a lot of restrictions on mergers and thus we had consolidated down our banks to essentially an oligopoly. Bush removed the leverage cap, and that spurred the system to react in the way it did. The result was that the system broke, and we now see the effects of what that breakage did.

Government cannot be totally divorced from the equation. If free market responses can handle a dynamic, it's typically best to allow the free market to do so. But it cannot address everything, and for the remainder we must use government in order to create a proper servo which will ensure stability in the market.

You know the time is right to take control, we gotta take offense against the status quo

Originally Posted by A. de Tocqueville

"I should have loved freedom, I believe, at all times, but in the time in which we live I am ready to worship it."

No, they didn't remove all the regulations as there was enough oversight to prevent what happened, political correctness led to the problems we had in 2008 when it was determined by our govt. that everyone has a right to own a house and thus turned their heads on personal responsibility. The Senate banking and other oversight committees existed but were probably too busy with cocktail parties to do their job.

That wasn't the kicker. Those loans, sure they may not have been made otherwise; but also the banks were subsidized for it as well. That wasn't the breaking point. The breaking point came when the final restrictions on leveraging were released.

You know the time is right to take control, we gotta take offense against the status quo

Originally Posted by A. de Tocqueville

"I should have loved freedom, I believe, at all times, but in the time in which we live I am ready to worship it."

To add to j-macs post concerning his experience with unions I would like to add mine. Since I graduated from high school with basically no money to pay for college I had a friend who had an "in" to the local IBEW (International Brotherhood of Electrical Workers) union. I took a test, applied and was accepted in their apprenticeship training program. The training program was the first evidence of what the union could do right: Produce trained, qualified workers. Next cool thing was when one Contractor ran out of work and you got laid off, you go to the union hall and sign up to take the next available job. We had a pretty sweet thing going. Most businesses in Mobile, Alabama at that time liked to hire union labor and were willing to pay a little bit extra for the quality. But things began to change after the first year I was a member. When I attended union meetings I found a lot of ignorant people were in leadership positions. They created a very much us versus them atmosphere between Contractors or owners if you will and the rank and file. Their attitude was to squeeze every last drop they could from the owners. The demands for pensions, vacations, medical and wages reached ridiculous proportions. Anyone one and I mean anyone who suggested reasonable alternatives was shouted down and intimidated. The union drove costs up so high that their usually loyal customers had no choice but to open up bidding to non-union shops. The unionís attitude was that they were union and they were better and you owed them. Somehow they couldn't imagine that the people who used union workers had a limit. They always thought that the Contractors and customers were being selfish and holding back on them. They threatened, and picketed their way out of business. A once formidable and viable organization lost it all. The rank and file began leaving and opening up their own non-union shops.

randel, unions just love having people like you for you are very easy to manipulate and brainwash. It really is a shame that you cannot see how unions keep you dependent and actually keep your wages down from what you could make on your own with a little incentive, creativity, and hard work. Everyone getting the same pay increase and no merit raises has to movtivate people with no initiative or drive plus the inability to lose your job due to seniority. With public unions the taxpayer gets screwed, with public unions companies go out of business.

I am going to point out exactly what happens with public unions no matter how much you dislike hearing the truth. Taxpayers fund union pay and benefits and regardless of how you feel that is reality.

conservative my friend, it would be so refreshing to actually hear you tell the truth for once.

Just goes to show the hypocrisy of a liberal who is always concerned about the "little guy" but not about how little they pay for Wal-Mart goods and services. That evil corporation is the largest employer in the country and provides goods and services at lower prices for that "little guy." Wal-Mart is an incredible corporate citizen, creates a lot of opportunities for the employees, and generates incredible tax revenue for the govt. Not being union is all that liberals look at, true hypocrits

Yep, brainwashed by the hundreds of thousands of employees at Wal-Mart, competing against Wal-Mart, being completely aware of their benefit and wage structure. Yep, Wal-Mart simply makes liberals and other union supporters crazy and to me that makes it even better. I can see why you support unions as it would be hard for you to compete in a non union shop for pay raises and promotions. One day you are going to wake up, look back, and wonder what happened as the world and others have passed you by.

Well, I wouldn't go that far. See, not only was there that, but as I have routinely reminded you, I grew up in a UAW town, state. Most, if not ALL of my friends worked for GM in one way or another. And I saw first hand what they got away with. The video of the workers from Detroit not too long ago wasn't that far off at all.

As for when I worked for Pepsi, as a side loader delivery person, one of my best friends in MD was the shop steward, and yes I did attend meetings when they were offered. See we were a small shop with only 14 drivers, and the local that represented us couldn't have cared less about anything other than taking my dues money. I think in 4 years we had, or were invited to 3 meetings. Two of those were contract approval sessions, and one was to ask that we stand with some Warehouse that was considering a strike, for $50 per week. Meanwhile, the relationship that having union representation in that business caused was not one where I thought it was a smooth endeavor to say the least. Let's just say that it IMHO causes a friction that doesn't need to be.

You make far too many assumptions to be taken seriously.

This was early on in my driving career, and I was very young with a family. I didn't know much back then and still thought that unions were ok. Chalk it up to being young and dumb...As I have been around for some time now it is not only Michigan, and my stint in Maryland that formed my opinion. My wife's father was Union all the way. Beth Steel in Baltimore for 40 years. In his prime that facility was over 5,000 strong, and a vibrant part of Baltimore. Now it would break your heart to see what it is. Little more than an eye sore on the way in to the harbor of Baltimore. With as few as 250 employees. When he retired, he had a pension, and a clock given him as a thanks for his 40 years of that place, and not two years after that he was informed that their pension fund was dead broke, and that it would be placed with the State for receivership, his monthly was cut by 2/3. Yeah he really came out good with that didn't he?

Let me just close with this. I am not totally anti Union. I can see where in a world of pendulum reality, that unions have a place with certain workplaces. Especially where work conditions, and safety of the employees are not being addressed by an employer properly. When my wife worked for Exel down here was a prime example. But, the problem is that unions inherently become corrupt, and go beyond what is a symbiotic relationship with the company's they destroy, and move toward greed themselves sucking the well dry, and then destroying the businesses they go after. And what of the people that the Unions have a direct hand in making available to the job market? huh? Do they care? hell no. When the business closes under the weight of the demands of the union mob, then the union just moves on and leaves its once proud members to dry up and blow away, in search of the next business concern to lean on for their protection racket.

Now your turn.

j-mac

first, i'm a little skeptical of your union experience, you will just have to excuse me on that one, as the 'going to meetings when offered' made me chuckle, as meetings are generally a monthly event, and posted on the union board at place of employment at least a week to ten days in advance...that statement was telling to me, as two of the meeting you attended were 'contract approval'...sounds to me like those were the only ones you were interested in attending. as for the rest, you continue with the whole anti-union spiel , which is taken out of the big business playbook. you don't seem to understand, or care to, that 'running a company out of business' goes against the union's best interest.